Service Vans Fuel Contractor’s Growth

Plumbing shop reinvents itself with a new fleet, new services and a cross-trained staff capable of tackling any job.
Service Vans Fuel Contractor’s Growth
Chris Roseland, co-owner of Backlund Plumbing in Omaha, Nebraska, stands in front of a 2012 Vacall AllExcavate hydroexcavator on the job site.

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Image is everything, even in the plumbing industry. Just ask Chris Roseland, the co-owner of Backlund Plumbing in Omaha, Nebraska, who watched revenue jump — and customers’ perceptions change — after the company invested in 10 new service vans featuring advanced, game-changing technology: engines that run on compressed natural gas.

The switch from conventional gasoline to CNG-powered vehicles in 2012 did more than just reduce the company’s monthly fuel tab. It also prompted a ripple effect of other benefits, including free advertising in the form of media coverage. It also gave the company a novel marketing angle — the ability to portray itself as a “green,” eco-conscious company — that helps it differentiate from other outfits in a competitive market.

“If I had to name one thing that helped spark our plumbing world, it would be our use of CNG,” says Roseland, who co-owns the company with his father, Mark. His father and late mother, Sally, originally bought the company in 1987; Chris joined the company in 1994 and earned a master plumber license in 2004. “At the time, we were driving outdated vehicles that didn’t look up to par. Switching to CNG vehicles prompted us to update our fleet and apply the (fuel) savings to buying more new trucks.

“We simultaneously rebranded the company — all our new plumbing vehicles hit the road at the same time with new vinyl wraps,” he continues. “It really helped our image and gave us a lot of free advertising from the press doing stories about our trucks. It’s hard to put a price on that. If I had to choose one thing that spurred our plumbing growth during the last several years, it was the conversion of our plumbing trucks to compressed natural gas.”

More conversions to CNG followed. Today, more than two dozen of the company’s vehicles run on natural gas: 12 Ford Econoline vans and seven Ford Transit vans, all used for plumbing and drain cleaning work; two Dodge 2500 flatbed delivery trucks; three Freightliner FL70 service trucks; two vacuum trucks built on Freightliner M2 chassis; and two Freightliner FL70 dump trucks.

Reduced operating expenses

High fuel prices played a key role in the decision to convert to CNG. In 2012, the nationwide average price for a gallon of gas hovered around $3.60. “At the time, we were doing work for the city’s Metropolitan Utility District and I noticed they were converting their vehicles,” Roseland recalls. “So I inquired about it.”

Research showed that CNG at the time cost just $1.70 a gallon. In addition, natural gas prices historically aren’t subject to the volatile swings commonly seen in gasoline prices. And while the conversion price was expensive — about $12,000 per service van — MUD was offering a 50 percent rebate. That sealed the deal, Roseland says.

“With financial assistance from the rebates, our break-even point was running 3,000 gallons (of CNG) through the vehicles,” he explains. “Each van saved about $4,000 the first year through reduced fuel costs. I’d say 90 percent of those first 10 conversions paid for themselves within the first two or three years.”

Now that gas is under $2 a gallon, the savings aren’t nearly as dramatic. But Roseland points out that since the vans’ conversions, the company has also converted the two Freightliner dump trucks and other vehicles that use diesel fuel, which currently costs about 50 cents more per gallon than CNG.

“When diesel is at $4 a gallon and CNG is $2 a gallon, we might save up to $250 a day,” he explains. “In my opinion, fuel prices eventually are going to go back up. Our vehicles have a seven- or eight-year life cycle, so we’re betting that fuel costs will average out higher in the next seven years.” In the short term, Roseland remains undaunted by lower fuel prices; the company plans to buy and convert five more Transit vans during 2016, he says.

Truck Center Companies does the CNG conversions. The process is relatively simple: The gas tank and fuel-delivery system is replaced with a CNG tank and a new fuel-delivery system. A different conversion kit enables the original gas engine to run on compressed natural gas, Roseland says.

Backlund’s revenues have increased since the CNG conversions, and he attributes much of it to the company’s ability to brand itself as a “green,” eco-conscious business. “I can verify that because we’ve only promoted it on our vinyl vehicle wraps, and when people call, they usually ask about the CNG trucks,” Roseland says. “They notice that we’ve done it. Our employees tell me that customers are always asking how it works. I think that if we’re on par with a competitor price-wise, we get chosen because we’re ‘greener.’”

There is one drawback to CNG-powered vehicles: Fueling stations are scarce. Roseland says the company is fortunate because there are two CNG stations within a mile of the company’s headquarters. In addition, the CNG vehicles have only a 250-mile range, so drivers must always be aware of their proximity to fueling stations. “But they’re adding more refueling stations every year,” he notes.

Diversified services

When the Roselands bought Backlund Plumbing in 1987, the Omaha-based business was a small service shop with three employees. Today, it’s a $10-million-a-year company with 65 employees. A critical factor in this extreme makeover? The expansion into a range of diversified services. Backlund now does residential, commercial and municipal drain cleaning; residential and commercial plumbing; sewer and water installations; cross-bore inspections; and septic tank pumping.

“We made a decision years ago to try to offer as many services in-house as possible versus using subcontractors,” Roseland says. “We’ve always felt that we can maintain the quality of our work and do a better job if we control these jobs instead of relying on subcontractors.

“If someone calls with a problem at midnight, we show up with all our vehicles and we don’t have to wait for a sub to show up,” he adds. “We run a 24-hour operation — no answering service. If the phone rings at 2 a.m., we answer it. Same-day service is a huge must in our world. And we also have the equipment ready to handle virtually any problem; we’re a one-stop shop for plumbing, pumping, utility work and hydroexcavating. If people asked us to paint their house, we’d probably paint their house. ... We’ll literally do anything.”

Moreover, offering a variety of services avoids the eggs-in-one-basket problem that some companies run into, which leaves them vulnerable to market downturns, he says.

The company’s primary focus on residential plumbing shifted dramatically in the early 2000s due to the recession-induced decline in new housing. “The market suffered for new houses and remodeling projects,” Roseland says. “So we jumped into the commercial market to diversify the company. … Since then, about 50 percent of our business comes from commercial work. We basically grow as our customers’ needs grow.”

Then customers started asking if Backlund did outside utility installations, such as new waterlines. The company didn’t — but in 2008, based on continuing requests, the company invested in tractors and backhoes so it could install fire lines and storm and sanitary lines. “There was a huge learning curve in learning how to do outside utilities,” he notes. “But we took our experienced plumbers and added utilities to their scope of work. They took OSHA confined-space entry classes and learned safe excavation techniques — things like what equipment to use in what situation, how to use it, and proper compaction and backfilling techniques.”

Much of the outside plumbing work is driven by infrastructure improvements. For instance, when Omaha officials recently embarked on a large project to separate the city’s storm and sanitary sewers, it also replaced water mains in certain locations. “That, in turn, drives demand for replacing waterlines to houses — changing lead service to copper,” Roseland explains. “We do a lot of water reconnects for our local utility, the Metropolitan Utilities District. In 2014, we reconnected about 700 waterlines to a new mainline.”

As services expanded, so did the company’s roster of equipment. Today, the company owns two trailer-mounted Spartan 798 water jetters (4,000 psi at 18 gpm), equipped with 500-gallon water tanks, and a 2010 Camel 1200 vacuum truck with hydroexcavating capability, made by Super Products. It features a 12-cubic-yard debris tank, a 1,500-gallon water tank, a Roots Systems blower (4,460 cfm) and a water pump (80 gpm at 2,000 psi) made by Myers.

In addition, the company relies on five cart-mounted drain cleaning machines made by Duracable Manufacturing; six VuTek push cameras for pipeline inspections, made by Insight Vision; several RIDGID Mini-SeeSnake pipeline inspection cameras; and a CUES-equipped Dodge Sprinter camera truck with a LAMP inspection camera that includes lateral launch capability.

The company also owns a 2012 Vacall AllExcavate hydroexcavating truck, built on a Sterling chassis with a 12-cubic-yard debris tank, a 1,300-gallon water tank and a 5,150 cfm Hibon blower; and two trailer-mounted vacuum hydroexcavators made by Ditch Witch. Used primarily for utility potholing, the units feature a 500-gallon debris tank and a 250-gallon water tank.

As for the future, Roseland says the company is aiming for 10 percent growth in sales during 2016, with much of the increase coming in sewer and water infrastructure work.

He also says acquiring another company isn’t out of the question. “We’re always thinking like that,” he says. “We’re always willing to consider getting into something new.”

Cross-training creates happier, more productive employees

One of the keys to Backlund Plumbing’s exponential growth during the last couple decades is a cross-training program that enables employees to perform a variety of functions, which improves efficiency at the Omaha-based company.

At Backlund, some plumbers know how to operate a vac truck, for instance. In other instances, sewer line cleaners can also run inspection camera systems. Along the way, employees make themselves more valuable — and sometimes even earn pay increases. “One of my best drain technicians became a full-time cross-bore CCTV technician,” says Chris Roseland, who co-owns the businesshis father, Mark, bought in 1987. “He got a substantial pay raise for acquiring a new skill.

“Cross-training is a big reason why we excel,” he adds. “We have very smart employees. One of our technicians likes to fix things, for example, so he learned how to repair pipeline inspection cameras. We also have interior commercial plumbers who want to be out in the dirt, digging. So they learn how to run excavating equipment. Then in winter, when there’s less digging going on, they can go back to doing interior plumbing again.”

Cross-training is time-consuming and requires thorough planning as well as a strong commitment. But in the end, it’s worth the time invested, Roseland says, and not just because of the increased efficiencies. “I think our employees are happier because on most days, they never know what they’ll be doing. ... We’re as far from an assembly-line job as you can get,” Roseland says. “Doing different things keeps them invigorated about their jobs and helps to prevent burnout.”

Backlund also improves retention by paying top wages and offering good benefits, such as more paid time off and a matching 401(k) retirement program, plus paying the bulk of employee health insurance premiums. “When people came to work for us 10 years ago, it was because we could give them 60- to 70-hour weeks and enable them to make more money,” Roseland points out. “Now they seem to prefer that we offer a 40- or 50-hour workweek, pay them a good wage and back it all up with a good benefits package.”

To build company loyalty and teamwork, Backlund also holds special events for employees, like Thursday night bowling-and-pizza parties or fishing/hunting trips. “Once we took 50 guys to a Kansas City Chiefs game,” Roseland says. “We treat employees like gold because they’re our most valuable asset.

“In 2015, we went from $8 million to $10 million in sales — with the same number of employees,” he adds. “I never thought we could top $10 million in sales. But we did it, thanks to diversified services and cross-trained employees.”


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